TrendForce breaks down how Coronavirus will affect tech industry

Written by Jennifer Allen

February 18, 2020 | 13:00

Tags: #coronavirus #covid-19

Companies: #trendforce

Research firm, TrendForce has presented its analysis of how it expects the Coronavirus to affect the tech industry in the coming months. 

Its current predictions suggest that there will be lower-than-expected shipments of many different products, including notebooks, monitors, smartphones, smart watches, and TVs. When it comes to how badly hit products will be, it depends on what they are.

For instance, TrendForce suggests that smartwatches will suffer the most with a revised forecast of 12.1 million units being shipped compared to the previous estimate of 14.4 million. Notebooks are expected to see a 12.3 percent decline with games consoles not far behind at 10.1 percent. TVs seem to have a better chance with a 4.5 percent drop from 48.8 million to 46.6 million.

The issues are meant to be primarily due to manufacturing delays or component shortages that come via factories being closed in China during the outbreak of the Coronavirus, now referred to as Covid-19.

Interestingly, memory products are mostly unaffected so far as memory was stockpiled before the Chinese New Year and its manufacturing process is generally more highly automated than other products.

TrendForce explains shortage issues in more detail, "the downstream ODMs and brands in the supply chain are undoubtedly hit the most by the coronavirus outbreak. These companies lost precious working days after work resumption was postponed. After their production is resumed, on a whole, operators' work resumption rate is low. Besides, all types of materials and components are in shortage. Hence, productivity plummets."

It doesn't come as a huge surprise given there have been many predictions in recent times regarding the impact of the virus outbreak, as well as the likes of MWC being cancelled. Apple has already announced that it is expecting its iPhone production to be slowed down by factory closures and has revised its revenue projection for the coming quarter. 

TrendForce predicts that it's a temporary slowdown that will soon pick up, but that's also hard to tell. The virus is slowing in terms of daily new cases but it's far from vanished with 1,886 new cases in the past day. With a mortality rate of 2.3%, it also feels a little mean-spirited to be too concerned about temporary manufacturing slowdowns. Especially while TrendForce reckons it'll pick up soon enough. Hopefully the firm is correct. 

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